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Iron ore crisis to slow steel capacity expansion after 2020:

The country is likely to face a major iron ore crisis due to the lapse of key operating mines by March 31, 2020. The deficit in domestic iron ore supplies after March 2020 is seen at around 80 million tonne. This, in turn, is bound to put brakes on building India’s steel-making capacity as it targets an ambitious 300 million tonne (mt) output by 2030.

Supplies in iron ore would be more pronounced in Odisha, the largest producing state where 17 mines are set to run out of operations. The combined annual capacity of these mines is estimated at 66 mt. The shortfall from Odisha would especially hurt the domestic steel companies as the state’s iron ore is predominantly used in within the country as opposed to the export-oriented ore in Goa and Karnataka.

Tata Technologies plots new growth through push in China, acquisitions:

Engineering services and product development IT services provider Tata Technologies is in expansion mode, which is based on two key strategies – enhancing focus on China and acquiring companies in various locations, including China at a later stage.

Tata Technologies has had a presence in China for the last few years through its members working in customer sites and a small shared office, but starting this month, with a brand new office in Shanghai, the focus on the world’s largest automobile market gets more trained. “China is growing exponentially for us and that’s a very exciting space,” Warren Harris, CEO & MD, Tata Technologies, told Autocar Professional, in an exclusive interview. The company’s revenue in China saw a whopping over 8-fold growth to $25 million last year over the previous year.

Lightweighting capabilities give new strengthTata Technologies is working with at least 5 Chinese OEMs. What is helping the company is its capabilities in technologies such as lightweighting that are highly valued by vehicle OEMs, and more so by electric vehicle (EV) makers.

China, the world’s largest EV market, has also devised policies to promote the electric vehicle industry. Harris ‘sees’ an inflection point in the global electric vehicle industry. “We anticipate in the next 3-5 years that the less than one percent market share EVs enjoy will, in some of the mature markets, get up to 3 or 5 percent,” says Harris. And since industry players have to prepare in advance to tap the opportunities that could come in 3-5 years, Tata Technologies is among the “beneficiaries of many of the decisions that are being taken now”. Banking on the growth opportunities, Tata Technologies has set its sights on crossing the $100 million mark in China in 5 years from now. That would be the equivalent of the company’s operations in US and Europe. “I would be disappointed if China is not the same size as our US and European organisations in 5 years’ time,” says Harris.

Fino Paytech, which just received the Reserve Bank of India’s licence to launch a payments bank, has inked a deal with ICICI group companies to distribute insurance products and tied up with Exide Life insurance to sell products via its distribution channel.

Fino Payments Bank will sell life and general insurance products of ICICI Prudential and ICICI Lombard.
“On life insurance, we have tied up with ICICI Prudential and Exide Life Insurance, on non-life we have only tied with ICICI Lombard,” said Rishi Gupta, CEO, Fino Paytech. “On the life side, we believe there are multiple products that can be sold, so we planned two tie-ups. Health insurance will also be provided by the non-life partner. We also got our corporate agency licence on insurance.”

Angry public shareholders of many companies listed on nonfunctional regional stock exchanges are inundating the market regulator with complaints of getting shortchanged by promoters rushing to buy back the shares.

Hundreds of such companies announced exit offers for public shareholders in the past few weeks, following a regulatory diktat that they either get listed on national-level bourses or delist.

In their complaints to the market regulator Sebi and stock exchanges, shareholders alleged the prices offered by the companies for their stake to be abnormally low. They want the share buyback price to be determined through a transparent process and not solely by the bankers hired by the companies themselves.

NSDL, Fino Paytech get final licence:

The Reserve Bank of India (RBI) has granted the final licence for payments bank to two more entities — Fino Paytech and National Securities Depository Limited (NSDL) — taking the number of entities who have received the final licence to six.

Among the 11 entities that had received in-principle licence in August 2015, three players, Cholamandalam, Tech Mahindra and Dilip Shanghvi, dropped out. Vodafone m-pesa is yet to apply for the final licence, while Aditya Birla group is yet to get the final nod.

A top official from NSDL said it aimed to start operations in three months.

Dhanlaxmi Bank,Catholic Syrian Bank ideal cases for merger:

With consolidation being the buzzword in banking circles these days, two of the country’ oldest banks – Catholic Syrian Bank and Dhanlaxmi Bank – which have also been takeover targets for long, are back in focus. According to experts, either a merger or an acquisition of these banks will happen soon.

“India is marching towards the idea of fully digital banking. Under the scenario, consolidation of small banks will be the new normal. Now banks are investing more on technology which smaller banks could not do. Hence, it is irreversible that consolidation of small banks would happen,” said V K Vijayakumar, investment strategist at Geojit Financial Services.

Tata Sons to invest upto Rs 10k crore in Group cos:

Among the first decisions taken by N Chandrasekaran as chairman of Tata Sons was to tighten the holding company’s control over the $103-billion conglomerate, recently shaken by a power struggle between Cyrus Mistry and Ratan Tata
The Tata Sons board approved a resolution to invest up to Rs 10,000 crore in various Tata group companies at the first board meeting chaired by Chandrasekaran on February 21.

“Resolved that approval of the board of directors be and is here by granted to the company to invest amounts not exceeding Rs 10,000 crore for subscribing to issues of securities and or purchasing securities in various companies of which Tata Sons is the promoter and or a shareholder,”according to the resolution, a copy of which has been filed with the ministry of corporate affairs.

Bulgebracket private equity funds Warburg Pincus, Carlyle and Temasek have been shortlisted for a 35% stake in ICICI Lombard General Insurance Co Ltd, the country’s largest private sector general insurer, in a deal that could fetch up to $1 billion, said people familiar with the development. The selection took place late last week after bids were received from four potential investors.

Others in the race included Blackstone, KKR, Advent and General Atlantic. The three will now conduct a final round of due diligence before submitting binding offers by April end, the people mentioned above said.

The merger will create India’s largest telecom player both in revenues and subscribers, taking on the likes Bharti Airtel and Reliance Jio.

Idea Cellular on Monday announced that its board has approved the merger of Vodafone India and its wholly-owned subsidiary Vodafone Mobile Services Limited with itself in the process creating the country’s largest telecom entity.

Vodafone will hold 45 percent in the combined entity. Idea promoters will hold a 26 percent in the combined entity. AB Group will have the right to buy 9.5 percent stake in the entity at Rs 130 per share.

Under the terms of agreement, the merger should be completed within 24 months.

“Upon the amalgamation of becoming effective, the entire business of VIL and VMSL ( excluding VIL’s investment in Indus Towers) will vest in the company,” Idea Cellular said in a statement.

“Vodafone will own 45.1 percent of the combined company after transferring 4.9 percent to Idea’s promoters or its affiliates for Rs 38.74 lakh crore in cash concurrent… Idea promoters will hold 26.1 percent of the company and the balance will be held by public,” according to the filing.

According to a report by broking firm CLSA in January, the merged entity will have revenues of over Rs 80,000 crore, giving it a 43 percent market share by revenues and a 40 percent market share by active subscriber base. The behemoth will account for over 25 percent of allocated spectrum and will have to sell about 1 percent to comply with spectrum cap norms.

It will be an all-share merger of Vodafone India (excluding Vodafone’s 42 percent stake in Indus Towers) and Idea. The merger will be effected through the issue of new shares in Idea to Vodafone and would result in Vodafone deconsolidating Vodafone India.

The merger will further intensify competition in the country’s highly-contested telecom space where players are gunning for both revenue and subscriber additions.

Bharti Airtel to sell non-controlling stake in Infratel:

The company has decided to sell or transfer 400 million shares to its wholly-owned subsidiary Nettle Infrastructure Investments Limited or to any potential investor.

Telecom operator Bharti Airtel has shelved plans to sell controlling stake in its mobile tower arm Bharti Infratel but has decided to monetise 21.63 per cent equity in the company.

“….the Board has at its meeting held on March 14, 2017 …decided not to monetise a controlling stake in Infratel for now,” Bharti Airtel said in a regulatory statement.

The company has decided to sell or transfer 400 million shares to its wholly-owned subsidiary Nettle Infrastructure Investments Limited or to any potential investor.

“Instead, the Board has decided that the company undertake a sale/transfer of upto 400 million Infratel equity shares owned by company which is over and above a controlling stake in Infratel, in such tranche(s), at such time(s) and for such consideration as may be deemed fit to its wholly-owned subsidiary Nettle Infrastructure Investments Limited and/or to any other potential investor(s),” the statement added.

Prem Watsa-owned Fairfax may have to reduce its stake in ICICI Lombard to get a second licence in the general insurance segment, the Insurance Regulatory and Development Authority (Irda) said.

When asked whether Fairfax will have to sell stake in ICICI Lombard to float another insurance company, TS Vijayan said chairman Irda said, “As per law they can promote only one insurance company. As a investor they can continue with less than 10% stake.”

Fairfax has applied a second licence to form a fresh joint venture in general insurance with Kamesh Goyal, a former executive at German financial services major, Allianz. As per the application, different entities of Fairfax will own close to 45% in the joint venture. Goyal will have a 15% stake and Oben Ventures will hold the rest.

Tata Sons, the holding company of the $103-billion conglomerate, raised Rs 4,115 crore by selling bonds to marquee local investors since removing Cyrus Mistry as chairman in October, regulatory filings with the ministry of corporate affairs show.

Tata Sons plans to use the funds raised for general corporate purposes, including refinancing of debt and investment in securities or providing loans to group companies, it said in a board resolution passed on September 15. The board approved raising not more than Rs 6,750 crore at “prevalent market rates in appropriate forms” in Indian or foreign currency in one or more tranches.

The funds were raised from December 14 to March 6. Tata Sons declined to comment. “We do not share information on such matters,” a Tata Sons spokesperson said in an emailed reply to ET. “From time to time, Tata Sons raises funds as part of its on-going activities.”For more details, kindly click on following link:

Carlyle, Warburg, Advent vie for ICICI Lombard stake:

Global private equity (PE) firms including The Carlyle Group, Warburg Pincus Llc and Advent International have evinced interest in acquiring the 35% stake in ICICI Lombard General Insurance Ltd held by Canadian financial institution Fairfax Financial Holdings Ltd, said two people aware of the development. The proposed deal will value the joint venture at $3 billion (around Rs20,000 crore), the two added, asking not to be identified.

ICICI Bank Ltd holds the remaining 65% stake in the joint venture.

ICICI Lombard, India’s largest private-sector general insurer, was set up in 2001 as a 74:26 joint venture between India’s largest private-sector lender ICICI Bank and Prem Watsa-owned Fairfax. Fairfax increased its stake in 2015 after ICICI Bank agreed to sell an additional 9% stake in its general insurance company for about Rs1,550 crore, valuing it at Rs17,225 crore.

ICICI Lombard has an overall market share of 8.82%. Reuters reported on 20 January that Blackstone Group and KKR and Co. were in talks with Fairfax for the stake sale. Mint learns that both have backed out on account of the high valuation of ICICI Lombard.